• Q : Calculating payback....
    Finance Basics :

    Old Country Inc. imposes a payback cut off of three years for its international investment projects. If the company has the following two projects available, should they accept either of them?

  • Q : Examining advantage of linear programming....
    Finance Basics :

    Discuss another advantage of linear programming. Please explain the reason for your choice

  • Q : Organization financial planning....
    Finance Basics :

    A strategic planning initiative for your organization and identify an initiative discussed in the organization's- annual report- Team member How the initiative affects the organization's financial p

  • Q : Examining the new price of a bond....
    Finance Basics :

    Determine the new price of a bond if duration is 21, convexity is 181, and current price of bond is $93.27. Assume yield changes by 40 basis points.

  • Q : Examining the expected gross profit....
    Finance Basics :

    Expected production costs are $600 per unit. In 2011, volume is expected to increase by 10%, while inflation will increase both the sales price and the cost per unit by 3%. In real dollars, expected

  • Q : Examining the expected npv of the project....
    Finance Basics :

    The probability of either outcome is 50%. Use a discount rate of 10%.What is the expected NPV of the project if the option to expand is considered.

  • Q : General relation between risk and return....
    Finance Basics :

    Describe the general relation between risk and return that we observe in the historical bond and stock market data.

  • Q : Discount rate yields the highest value....
    Finance Basics :

    What happens to the "Calculated Value" as the discount rate changes? What discount rate yields the highest value? Why? (150 words)

  • Q : Examining degree of operating leverage....
    Finance Basics :

    A proposed project has fixed costs of $36,000 per year. The operating cash flow at 18,000 units is $58,000. What will be the new degree of operating leverage if the number of units sold rises to 18,

  • Q : Stressful method of conversion....
    Finance Basics :

    Because the failure of an ERP may mean bankruptcy for an organization, what is the most stressful method of conversion to an ERP system?

  • Q : Premiums of an insurance policy....
    Finance Basics :

    The premiums of an insurance policy are $50 per quarter, payable at the start of each quarter. If a policyholder wants to pay one year's premiums in advance, how much should she pay, given interest

  • Q : Examining principal financial statements of a corporation....
    Finance Basics :

    What are the three principal financial statements of a corporation? Briefly describe the purpose of each statement.

  • Q : Market share-profits in banking....
    Finance Basics :

    Economists representing the Federal Reserve, the FDIC, and the Office of the Comptroller of the Currency have gathered for meeting discuss a formal response to concerns that top managers at some of

  • Q : Examining stock split....
    Finance Basics :

    Gamma Medical's stock trades at $145 a share. The company is contemplating a 3-for-2 stock split. Assuming that the stock split will have no effect on the market value of its equity,

  • Q : Examining the stock values....
    Finance Basics :

    Ziggs Corporation will pay $3.85 per share dividend next year. The company pledges to increase its dividend by 4.75 percent per year, indefinitely.

  • Q : Evaluate the proposed zero-balance account....
    Finance Basics :

    The firm currently has no other deposits in the bank. Evaluate the proposed zero-balance account, and make a recommendation to the firm, assuming that it has a 12% opportunity cost.

  • Q : Home ownership and automobile polices....
    Finance Basics :

    Analyze insurance options for home ownership and automobile polices. Give an example of how they are similar and how they are different.

  • Q : Property and liability insurance....
    Finance Basics :

    Compare property and liability insurance and create a scenario where it would be beneficial to have both types of insurance.

  • Q : Behavioral phenomena involved in the issue....
    Finance Basics :

    The article mentions that venture capitalists also provided funding to biotechnology start-ups hoping to earn a profit when these firms go public. Discuss whether there are any behavioral phenomena

  • Q : Examining effective annual rate....
    Finance Basics :

    The loan (principal plus interest) must be repaid at the end of the year. Midwest Bank also offers to lend you the $50,000, but it will charge an annual rate of 7.0%, with no interest due until the

  • Q : Estimate the value of the firm....
    Finance Basics :

    Assuming that the firm is in stable growth, and that the return on capital and reinvestment rates from 1998 can be sustained forever, estimate the value of the firm

  • Q : Cross-over rate between two projects....
    Finance Basics :

    What is the cross-over rate between the two projects? Determine the cost of capital at which the NPV of project A is zero. Determine the cost of capital at which the NPV of project B is zero.

  • Q : Determining firm required rate of return....
    Finance Basics :

    Investors expect the average annual future return on the market to be 12.50%. Using the SML, what is the firm's required rate of return?

  • Q : Evaluating project risk in capital budgeting....
    Finance Basics :

    If bankruptcy costs and/or shareholder under diversification are an issue, what measure of risk is relevant when evaluating project risk in capital budgeting?

  • Q : Calulation of incremental cash flows....
    Finance Basics :

    Which of the following is NOT considered in the calulation of incremental cash flows?

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